The world we live in is very unpredictable. In our journey through life, we all do the best we can to survive. We work hard in order to give our families a better life. As we venture into the opportunities that lie ahead with the cryptocurrency market, it is important to plan for the future the same way that we do with other traditional assets. It is important to make sure you have taken into account unprecedented events that can strike down upon you at any moment. The last thing you want is for your investment to be lost in cryptospace forever.
Trust Your Knowledge
Trust and blockchain are two things that do not go together. One of the purposes of blockchain is to eliminate the need for trusting a third party. Unfortunately, there are still centralized aspects within the blockchain industry that require a form of trust. Every time you deposit tokens into an exchange, this trust gets put to the test. How many times have you heard of exchanges being hacked? In fact, I got my stuff taken from MtGox back in the day. And I blame no one else but myself. I just didn’t take the time nor the effort to think of what could happen. Part of it was that the information regarding security was hard to find. That’s actually pure BS. I was just lazy and didn’t take the time to research it. You live and you learn.
An exchange getting hacked is one thing, but there are other things that could be just as bad. What if access to the funds is controlled by just one person at the exchange, let’s say the CEO? Will anyone else in the exchange be able to access the cold wallet in order to retrieve your funds? If this were to happen, you are in big trouble. You better start saving all over again for your kid’s college tuition. That house you planned on getting just got swallowed by the crypto black hole.
Won’t Be The First Nor The Last
A Canadian exchange by the name of QuadrigaCX is currently going through exactly this ordeal. The founder died in December of 2018 while being the only person with control or knowledge of the company’s cold storage wallet, where most of the funds resided. This has put approximately $150 million dollars of cryptocurrencies in a state of non-existence. A lot of lives will be changed by this unfortunate event. Hopefully they can break into his encrypted laptop files and get access to the wallet.
To make matters worse, QuadrigaCX customers have deposited more money, both as automatic payments and as manual payments, to the QuadrigaCX exchange even after the company filed for creditor protection. This goes to show that it is important to keep up to date with your investments. This is money that could have easily been saved. Who knows what will happen now.
Not Leaving Your Family Empty Handed
One thing that very few people plan for when investing in crypto is assigning a beneficiary. With traditional investments, such as safety deposit box accounts, bank accounts, and retirement plans, setting up a beneficiary is extremely easy. You just sign a few papers or online forms and you are done. With crypto, that is not the case. Did you assign a beneficiary when you signed up to Binance? Does your family know how to access your ledger? Who will get the funds if something happens to you? Even if it can be done, I am sure it will be a hassle. So what can you do? The answer is to think it through.
Let’s use Binance as an example. What will your family members need to access your account? Not only do they need your login information, but they will also need access to you phone and your email account. After all, they need your Google Authenticator and the email verification to accept the new device detection as well as the withdrawal confirmation. Did you think about that? But, of course, you probably don’t want to give that information to anyone just yet. So now you have to be creative.
Some things you can do:
-Keep this information in a safety deposit box with clear instructions and with the beneficiary assigned for this safety deposit box. Going to probate can complicate things.
-Include instructions in a will of where they can find this information(splitting information like private keys and passwords in 2 separate locations is safer in case one location gets compromised).
-Have this information encrypted in several flash drives and leave instructions on location and how to access the files.
I am sure you can come up with a million variations of accomplishing the same thing, so I’ll stop there. But do let the beneficiaries know of your plan so they can take the necessary actions to safeguard their future.
Important Note: Binance was used in this example as I know many people have their funds stored there. Nonetheless, an exchange should only be used to trade. Trade and get out. An exchange should not be used for long term storage as exchanges can get hacked, amongst other things. Use cold storage(such as a paper wallet) or a hardware wallet to store your cyrptocurrencies.
A Better Life for Your Loved Ones
After a whole year of putting up with your entire family criticizing you for buying Tron at $0.30 with your life savings, the least you can do is show them that you were right. That wouldn’t be the case if they cannot access the funds. Besides, you probably want what is best for them anyways. So please do your loved ones the favor of planning ahead for worst case scenarios. It really wouldn’t be cool if they couldn’t live a much better life just because you were lazy and didn’t take the time to prepare.
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|This article was written by the Tron Spark team. Tron Spark is a digital content platform currently serving as a Tron Super Representative. We believe that with the help of the Tron community, we can inform and educate the masses on the exciting evolution of blockchain technology, cryptocurrencies, and the Tron Protocol. Please support our efforts by voting for us.|